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tv   Political Capital With Al Hunt  Bloomberg  March 22, 2014 9:30am-10:01am EDT

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>> this week on "political capital" -- russian experts talk about what's next there. jason furman on the economy. julianna goldman on the keystone pipeline. and we debate romney's strong words. we begin the program with former deputy secretary of state and president of the brookings institution and one of america's foremost experts on russia, strobe talbott. you know putin. what do you think his appetite is? is he going to go into eastern ukraine?
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>> his appetite is unstated. we should not kid ourselves into thinking that now that he has grabbed ukraine and made it part of the russian federation -- that is it. he gave a speech to parliament in moscow several days ago. it was full of lies. perhaps the single most important and ominous lie was where he said, "i have no desire whatsoever to destabilize ukraine." he has every desire to do that unless the time comes when ukraine is a state of russia once again. >> how effective is the response of the u.s. and the eu? what more can we do? >> i would say it is too soon to see how effective it has been. that hasn't changed russian behavior and is not going to change putin's own determination to have his way. he is in a mood of bring it on, make my day, you tell me something that i shouldn't do
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and i will do it next tuesday. that is his attitude. the sanctions that the obama administration has put in which are not only against individuals, but also against institutions, in particular, kremlin's favorite bank. i would say that over time and other sanctions that are part of the chess game that will be played out could have some affect on the power structure in general in russia which may go to the boss and say this is not the greatest thing to do. maybe we should slow it down. i think it has to be indirect. >> he doesn't have to worry about the voters. >> this has been a one-man show. i don't think since stalin was in the kremlin has there ever been a single individual who could do something like this. if you go back to brezhnev, he would have to go for the popular
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vote. >> how about lifting the ban on crude oil exports? almost 40% of the revenues comes from oil. if we really try to drive down the price, that could really create economic hardship. >> as for all economic sanctions, they are intended to have a punishing affect on russia to make putin pay a cost. the critical thing, particularly with the president in europe, is for him to consolidate as much as possible the international community's reaction so that putin does not have an opportunity to play us off against each other. let's say he were to take action against boeing in retaliation for something which has a lot of business in russia. we want to avoid a situation where guest who comes in? air bus. >> how much leverage does obama have? a lot of presidents had to deal with the old soviet union
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russia. how does his leverage compare to the other presidents? >> we have never been in this particular situation. remember that obama up until now and his predecessor -- all of his predecessors going back to ronald reagan -- were dealing with a late soviet union and a russia that was in a different place than putin's russia. going back to the time that margaret thatcher said gorbachev was somebody we could do business with. ronald reagan was able to cut some deals with them. gorbachev said we are going to have a relationship based on partnership. that continued from gorbachev
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into yeltsin. from reagan into bush 41 and into the early years of the obama administration. that era is now behind us. we now have overtly put a leader in the kremlin who does not believe the fundamentals of the u.s.-russian relationship and the relationship between russia and the west is one of partnership. he sees it as adversarial. it is a new ballgame. by going over what i think is the ultimate red line with regards to russia -- the border around russia and actually grabbing a piece of territory from an independent, sovereign state and pulling that into russia, he has created not just
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a new fact on the ground but a new danger which is that we have a russia that is going to make great russian nationalism and going back and getting a hold of a territory where there are a lot of russians. that is a very dangerous development. it is what got the world into numerous wars in the early 20th century. we are going to have to rethink our strategic collations. >> will part of this retaliation be that he will withdraw any cooperation in afghanistan or syria? >> every single piece of business that the united states and the allies had to do with russia is going to be more complicated, including the syria and iran negotiations. they are going to tell the negotiators that they are going to not make anything easier for the united states. however, russia does have an interest in syria not being a
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chemical weapon state. it does have an interest in iran not being a chemical weapon state. it will make the negotiations harder. >> the more that russia expands, the weaker or problematic it becomes -- that was the soviet union. is that true today of russia? >> that is a piece of wisdom that is eternal. it is absolutely the case today. i think one aspect of this that has not gotten as much attention as it might is that there is a downside for russia in the policy that putin is pursuing. i am not talking about punishment from the west and isolation. i am talking about what it means for russia itself. if putin sitting in moscow tells the whole world and all the people of the russian federation, i am going to be the champion of mother russia who is going to take care and protect her children who are on the
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other side of neighboring borders. what is that going to say to the extremely large part of the russian population that is not russian? that is islamic in origin, central asian. they already don't have a lot to love coming from moscow and i think it is going to make them more restive and create an opportunity for wild and crazy guys with turbans and long beards who are already declaring a -- caliphate of the caucuses. the caucauses includes russian territory -- chechnya and others. the forces within the russian federation are going to be exacerbated by what putin is doing in the short term and going back to the geopolitics of the last two centuries.
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>> thank you for being with us today. when we return, white house council of economic advisors chairman jason furman. ♪
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>> we are joined now by the chairman of the council of economic advisers jason furman. what effect will the unrest in ukraine, russia may spill over to europe? will that have any effect on the
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u.s. economy? >> we are monitoring that situation closely and there is a range of things that affects our economy. that could certainly be one of them but what is going to happen with consumer spending, what is going to happen with investments in housing -- >> this isn't -- >> it is something we are monitoring closely. we always pay attention to these events around the world. >> if we really want to punish the russians, why don't we immediately initiate exports of natural gas so europe can be weaned off the dependence of russia? prices are low. if we're serious about this crisis -- >> the department of energy has issued permits. >> i am talking all massive exports. why not now? >> we have a statute that it has to be in the public interest of the united states. the department of energy looks at those permits and makes sure it is in the interest of the united states and if it is, they grant it.
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>> is there any economic policy against that policy in exporting to europe right away? >> i hate to give you the same answer but it is something the department of energy -- >> you are the chairman. >> there is a study that we have been relying on which finds these natural gas exports does not have benefits for the u.s. economy. i think the boom in energy is one of the things fueling our growth. >> let's see if we get more out of the affordable care act. you may get close to your 7 million target. only about a quarter of young people. doesn't that suggest that premiums will likely rise? >> there have been a number of studies that find that some of these differentials you see are not going to have a huge impact on premiums. we always see the demographic
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profile improving as we get closer to the deadline. big picture -- premiums this year were 15% below what the congressional budget office originally agreed to. they are already way lower. >> you don't look for any significant increase in premiums? >> i look for them to be below what was originally projected. >> budget deficit, you said, is declining. that is the good news. then it is going to turn around and over the long run, you still have to address it. in your budget, you pull back from one of the ways to address it which is entitlements that the president proposed last year. if you have to do it over the long run, why pull back? >> if you look at the budget, the bottom line numbers look to even lower deficits and lower debt the last budget because we added some things and dropped
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some things. that is no longer in our budget but that offer remains on the table. if speaker boehner wants to do significant revenue and wants to make that part of the deal, the same offer the president made is still on the table. we have showed how you can get the deficit and debt under control without taking that step. it does include entitlement reform on the health side as part of a balanced package with revenue, but we didn't need that to hit our fiscal target. >> one republican who did oppose it was dave camp with his tax proposal that came about. was his tax proposal a constructive step? >> absolutely. it has a lot of thoughtful ideas. it takes money and puts it into infrastructure as part of tax reform which is an idea the president came out with. we have some concerns. it may balance in the first decade, but it has costs in future decades because some of
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the costs are shifted out with some protection on low income households that are not there and taxes would go up after 2017. it has a lot of good ideas and we are taking a look at all of them. >> could it be the beginning of some negotiations for next year? >> it is the continuation of a process. the president came out a couple of years ago and called for the corporate tax rate at 28%. he called for investment in infrastructure. you see ideas along those lines in camp's proposal because it is a continuation of the process. we have had conversations with him since the tax form has come
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out. >> it is no secret that you were a supporter of larry summers for fed chairman. janet yellen got it and she had her first press conference. were you encouraged? >> i think she is doing a terrific job as fed chair. while i would not comment on any particular decision the fed is making, we knew how qualified she was when she was picked. she has really shown those qualifications in everything she has done since becoming chair of the fed. >> where will unemployment be at the end of this year? >> when we did our budget forecast, we projected the unemployment rate would be in the high sixes. that forecast was done in november. there has been a lot of good news. the unemployment came down faster than a lot of people thought. >> do think you could get it under six by the end of this year? >> i expect it to continue to fall. >> wall street is booming.
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profits are up. wages for the middle-class class and working poor have stagnated. isn't that what republican policy produces? >> you see job creation. the unemployment rate coming down as labor market start to tighten. you start to get pressure for better wages. in the last year, you have seen real wages rise by over a percent. it is only the last year or two you have seen it rise. we have to make up for several decades of stagnated wages. >> thank you for being with us. mitt romney's strong words and scott brown is back. right after the break. ♪
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>> welcome back. we will turn to martyr calls and little bit. julianna goldman is here to talk about the high-stakes keystone pipeline decision. you reported this week that the policy advisers all wanted to veto the keystone pipeline. >> there is a consensus emerging among the president top advisers. dan pfeiffer, that he should reject the pipeline. he is not involved in the decision-making because -- the politics are really messy right now. they have dragged this process out. they could intersect with the november midterm. if he rejects it, it really stands to hurt some key vulnerable incumbent senators.
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it makes her look pretty ineffective if after pushing the president who approved the pipeline and he goes and rejects it. >> they really are scared stiff about losing the senate. >> they are terrified. i have talked to a number of democrats over the past few weeks to say that they have noticed that over the past month, the president, his aides have woken up to the fact that democrats could really lose the senate. the flip side of that argument is that he does go ahead and approve the pipeline, then he risks alienating the billionaire tom stier who is putting millions of dollars into democratic campaigns. he is threatening that if the president approves the pipeline, he is going to keep his money out. >> what does the president think? >> the president feels that the
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argument on both sides are really inflated. it is not the job bonanza that republicans and unions claim it is. it is not going to be the my mental catastrophe that people claim it is. that is why it weighs more to this coming down to a political decision. he really still couldn't figure out another way to delay this. >> thank you. your former boss, mitt romney, wrote this week that if only barack obama had been tougher earlier, he could've headed off the crisis in crimea. do you think putin would have heeded that? >> i don't think there is any question that america exercise stronger leadership toward russia and toward putin, things would've been different. president obama lifted the tough sanctions that were put in place by george w. bush after russia invaded georgia. president obama was absent in
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terms of bringing the ukraine closer to the eu. there is no question if president obama exercised stronger leadership and a stronger tone with putin that things could have been different. >> no question, margaret? >> poland, hungary, afghanistan, parts of georgia have all fallen. putin does not respond to the usual sanctions. he has no electorate to worry about. there is a nationalistic fervor that is fueling him. putin is putin. it is very difficult to say that some kind of leadership -- should he rip off his shirt? -- is going to make a difference. >> scott brown is now going to run for senator in new hampshire. is this a movable feast? >> this is the candidate who
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loves taking his shirt off. might annex crimea. we have carpetbaggers and then carpetbaggers. this is somebody trying to win in a neighboring state. we haven't had a senator from two different states since the 19th century. he is not a fresh face. his opponent is very tough. she has a great team. he has an uphill fight. >> uphill fight? >> it will be a tough election. jeanne shaheen and barack obama are tied at the hip and there is no question that she was one of the deciding votes for obama care which is not going to be a good issue for the president come november. i think scott brown's candidacy is a good news. the republicans don't need a victory there. this is all good news for the gop heading towards november. >> thank you all.
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millions of american men and women wear the military uniform with honor. two who don't are general jeffrey sinclair who sexually abused and mistreated a junior officer and colonel james pohl, the military judge who let him off the hook. no jail time and he gets to keep his pension and other benefits. they both disgrace the uniform and prove the military chain of command justice is a fraud. thank you for watching. we will see you again next week. >> "political capital" is a production of bloomberg television. ♪
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>> it is march madness on "market makers." we will tell you about building a perfect bracket. wait until you hear who the biggest name on wall street are picking. why the final four has become the most valuable asset for cbs. the lawyer who wants college players to get paid and plans to take the ncaa to court. join us as we focus on the "bracket business." welcome to a special march madness edition of "market makers." over the next three weeks, millions of people will get swept up in filling out brackets, watching games, and cheering for their favorite college basketball teams. billions of dollars will be on the line but under the current ru